Forces loyal to Ivory Coast's incumbent leader Laurent Gbagbo have gained ground in Abidjan, the UN says.
UN peacekeeping chief Alain Le Roy said Mr Gbagbo's forces had used a lull for peace talks to strengthen their position in the country's main city.
Forces loyal to the internationally recognised president Alassane Ouattara had been besieging Mr Gbagbo in his residence in Abidjan.
But the UN says Mr Gbagbo's troops now control two districts of the city.
"They clearly used the lull of Tuesday as a trick to reinforce their position," Mr Le Roy said, referring to a dip in the fighting after three of Mr Gbagbo's generals requested talks.
It had appeared three days ago that Mr Gbagbo was on the verge of defeat but the upscale Plateau and Cocody areas of Abidjan are now fully in the control of his forces.
The BBC's Mark Doyle, in Abidjan, says the Ouattara camp's claim to have Mr Gbagbo's residence surrounded appears exaggerated.
Pictures have also reappeared on the Gbagbo-controlled RTI television, saying: "The regime of Gbagbo is still in place, a strong mobilisation is required by the population."
Mr Le Roy said that there was evidence that his forces were still using weapons including tanks, M-21 rocket launchers, rocket-propelled grenade launchers and armoured personnel carriers.
Heavy-weapons fire from Mr Gbagbo's forces targeted the French ambassador's residence in the city on Friday, the French embassy said.
A spokesman for Mr Gbagbo said his forces had not attacked the building.
Ahoua Don Mello said he "formally denied" the French embassy's statement that the house had been targeted by two mortars and a rocket from positions held by Mr Gbagbo's forces.
"France is just looking for a pretext to get rid of President Laurent Gbagbo," Mr Alain said.
Ports to reopen
Earlier on Friday, the European Union said it had agreed to ease sanctions imposed against the country.
Mr Ouattara had appealed for the easing to enable cocoa exports in the world's largest producer of the crop to resume.
The EU said it would lift four sets of sanctions.
"Under the measures adopted today, the ports of Abidjan and San Pedro, the Ivorian Refining Company and the Coffee and Cocoa Trade Management Committee are removed from the list of entities subject to the EU assets freeze," the EU said in a statement.
The UN has certified Mr Ouattara as the winner of November's run-off vote for president but Mr Gbagbo has refused to cede power.
Mr Ouattara's forces have swept down from the north over the past two weeks but much of the main city of Abidjan is dominated by Gbagbo supporters and days of fighting have plunged it into crisis.
As the military standoff continued in Abidjan, the United Nations said that more than 100 bodies had been found in three locations in the west of the country, the victims of apparent ethnic killings.
UN High Commissioner for Human Rights Navi Pillay described the reports that the team in Ivory Coast was sending back as "utterly horrifying".
Human Rights Watch Africa director Daniel Bekele said: "A line cannot be drawn between north and south, or supporters of Gbagbo and Ouattara. Unfortunately, there are those on both sides who have shown little regard for the dignity of human life."
UN relief agencies have warned of a looming crisis and called for humanitarian corridors to allow safe passage for thousands of people fleeing the fighting.